General Conditions 101 (2013-10-15) - Low Complexity - Goods or Services - Part I
In the Contract, unless the context otherwise requires:
- "Applicable Taxes"
- means the Goods and Services Tax (GST), the Harmonized Sales Tax (HST), and any provincial tax, by law, payable by Canada such as, the Quebec Sales Tax (QST) as of April 1, 2013;
- "Articles of Agreement"
- means the clauses and conditions set out in full text or incorporated by reference from the Standard Acquisition Clauses and Conditions Manual to form the body of the Contract; it does not include these general conditions, any supplemental general conditions, annexes, the Contractor's bid or any other document.
- "Canada", "Crown", "Her Majesty" or "the Government"
- means Her Majesty the Queen in right of Canada as represented by the Minister of Justice and the Attorney General of Canada and any other person duly authorized to act on behalf of that minister;
- means the Articles of Agreement, these general conditions and any other document specified or referred to as forming part of the Contract, all as amended by agreement of the Parties from time to time;
- "Contracting Authority"
- means the person designated by that title in the Contract, or by notice to the Contractor, to act as Canada's representative to manage the Contract;
- means the person, entity or entities named in the Contract to supply goods, services or both to Canada;
- "Contract Price"
- means the amount stated in the Contract to be payable to the Contractor for the Work, exclusive of Applicable Taxes;
- "Government Property"
- means anything supplied to the Contractor by or on behalf of Canada for the purposes of performing the Contract and anything acquired by the Contractor in any manner in connection with the Work, the cost of which is paid by Canada under the Contract;
- means Canada, the Contractor, or any other signatory to the Contract and "Parties" means all of them;
- "Total Estimated Cost", "Revised Estimated Cost", "Increase (Decrease)"
- on Page 1 of the Contract or Contract Amendment means an amount used for internal administrative purposes only that comprises the Contract Price, or the revised Contract Price, or the amount that would increase or decrease the Contract Price and the Applicable Taxes as evaluated by the Contracting Authority, and does not constitute tax advice on the part of Canada;
- means all activities, services, goods, equipment, matters and things required to be done, delivered or performed by the Contractor under the Contract.
02 Status of the Contractor
The Contractor is an independent Contractor engaged by Canada to perform the Work. Neither the Contractor nor any of its personnel is engaged as an employee, servant or agent of Canada. The Contractor is responsible for all deductions and remittances required by law in relation to its employees.
03 Incapacity to Contract with Government
It is a term of this contract that the Contractor and any of the Contractor's employee assigned to the performance of the contract are in compliance with Section 748 of the Criminal Code of Canada which prohibits anyone who has been convicted of an offence under :
- Section 121, Frauds on the government
- Section 124, Selling or purchasing office; or
- Section 418, Selling defective stores to her Majesty
From holding a public office, contracting with the government or receiving a benefit from a government contract, unless the Governor in Council has restored (in whole or in part) these capacities to the individual or the individual has received a pardon.
04 Condition of Material
Unless provided otherwise in the Contract, material supplied must be new and conform to the latest issue of the applicable drawing, specification and part number that is in effect on the bid solicitation closing date or, if there was no bid solicitation, the date of the Contract.
- The Contractor shall indemnify and save harmless the Minister and the Department of Justice from and against all claims, losses, damages, costs, expenses, actions and other proceedings, made, sustained, brought, prosecuted, threatened to be brought or prosecuted, in any manner based upon, occasioned by or attributable to any injury to or death of a person or damage to or loss of property arising from any willful or negligent act, omission or delay on the part of the Contractor, the Contractor's servants or agents in performing the work or as a result of the work.
- The Contractor shall indemnify the Minister and the Department of Justice for all costs, charges and expenses whatsoever that the Minister of the invention claimed in a patent, or infringement or alleged infringement of any patent or any registered industrial design or an copyright resulting from the performance of the Contractor's obligations under the contract, and in respect of the use of or disposal by the Minister of anything furnished pursuant to the contract.
- The Contractor's liability to indemnify or reimburse the Minister under the contract shall not affect or prejudice the Minister from exercising any other rights under law.
06 Inspection, Acceptance and Warranty
- The Contractor must perform the Work efficiently in accordance with standards of quality acceptable to Canada and in full conformity with all the requirements of the Contract.
- All the Work is subject to inspection and acceptance by Canada. Despite inspection and acceptance of the Work by or on behalf of Canada and without restricting any provisions of the Contract or any condition, warranty or provision imposed by law, the Contractor, if requested by Canada to do so, must replace, repair or correct, at its own option and expense any work that becomes defective or fails to conform to the requirements of the Contract, where applicable. For goods, the warranty period will be twelve (12) months after delivery and acceptance of the Work or the length of the Contractor's or manufacturer's standard warranty period, whichever is longer.
- Canada must pay the transportation cost associated with returning the Work or any part of the Work to the Contractor's plant for replacement, repair or making good, and the Contractor must pay the transportation cost associated with forwarding the replacement or returning the Work or part of the Work when rectified to the delivery point specified in the Contract or to another location as directed by Canada. If, in the opinion of Canada, it is not expedient to remove the Work from its location, the Contractor must carry out any necessary repair or making good of the Work at that location and will be reimbursed its reasonable travel and living expenses.
- The warranty period is automatically extended by the duration of any period or periods where the Work is unavailable for use or cannot be used because of a defect or non-conformance during the original warranty period. The warranty applies to any part of the Work replaced, repaired or corrected pursuant to subsection 2, for the greater of:
- the warranty period remaining, including the extension, or
- ninety (90) days or such other period as may be specified for that purpose by agreement between the Parties.
07 Security and protection of the work
Notwithstanding the Validity Date of the contract, it is a precondition of the contract that the Contractor have a Security Clearance at the level designated for work assignment. The Contractor shall take all reasonable steps necessary to ensure that its performance of the work, in accordance with the provisions of the contract, adheres to all requirements of this Security Clearance level. The Minister may, at any time, conduct an examination of the Contractor's premises, documents and records to verify whether the Contractor is complying with the security requirements of the contract.
08 Invoice Submission
- Invoices must be submitted in the Contractor's name. The Contractor must submit invoices for each delivery or shipment; invoices must only apply to the Contract. Each invoice must indicate whether it covers partial of final delivery.
- Invoices must show:
- the date, the name and address of the client department, item or reference numbers, deliverable/description of the Work, contract number, Client Reference Number (CRN), Procurement Business Number (PBN), and financial code(s);
- details of expenditures (such as item, quantity, unit of issue, fixed time labour rates and level of effort, subcontracts, as applicable) in accordance with the Basis of Payment, exclusive of Applicable Taxes;
- deduction for holdback, if applicable;
- the extension of the totals, if applicable; and
- if applicable, the method of shipment together with date, case numbers and part or reference numbers, shipment charges and any other additional charges.
- Applicable Taxes must be specified on all invoices as a separate item along with corresponding registration numbers from the tax authorities. All items that are zero-rated, exempt or to which Applicable Taxes do not apply, must be identified as such on all invoices.
- By submitting an invoice, the Contractor certifies that the invoice is consistent with the Work delivered and is in accordance with the Contract.
09 End of Fiscal Year Invoice
Notwithstanding the Payment Schedule, each year on or about March 31, the Contractor will, at the request of the Project Authority, submit an end-of-the-year invoice corresponding to the value of the total work performed during the year preceding that date less any amounts previously paid or invoiced during such year.
All subsequent payment(s) payable pursuant to the Payment Schedule contained in the contract will be reduced by any amount which could have been paid pursuant to this clause.
- Federal government departments and agencies are required to pay Applicable Taxes.
- Applicable Taxes will be paid by Canada as provided in the Invoice Submission section. It is the sole responsibility of the Contractor to charge Applicable Taxes at the correct rate in accordance with applicable legislation. The Contractor agrees to remit to appropriate tax authorities any amounts of Applicable Taxes paid or due.
- The Contractor is not entitled to use Canada's exemptions from any tax, such as provincial sales taxes, unless otherwise specified by law. The Contractor must pay applicable provincial sales tax, ancillary taxes, and any commodity tax, on taxable goods or services used or consumed in the performance of the Contract (in accordance with applicable legislation), including for material incorporated into real property.
- In those cases where Applicable Taxes, customs duties, and excise taxes are included in the Contract Price, the Contract Price will be adjusted to reflect any increase, or decrease, of Applicable Taxes, customs duties, and excise taxes that will have occurred between bid submission and contract award. However, there will be no adjustment for any change to increase the Contract Price if public notice of the change was given before bid submission date in sufficient detail to have permitted the Contractor to calculate the effect of the change.
- Tax Withholding of 15 Percent - Canada Revenue Agency
Pursuant to the Income Tax Act, 1985, c. 1 (5th Supp.) and the Income Tax Regulations, Canada must withhold 15 percent of the amount to be paid to the Contractor in respect of services provided in Canada if the Contractor is not a resident of Canada, unless the Contractor obtains a valid waiver from the Canada Revenue Agency. The amount withheld will be held on account for the Contractor in respect to any tax liability which may be owed to Canada.
11 Transportation Costs
If transportation charges are payable by Canada under the Contract and the Contractor makes the transportation arrangements, shipments must be made by the most direct and economical means consistent with normal shipping practice. The charges must be shown as a separate item on the invoice.
12 Transportation Carriers' Liability
The federal government's policy of underwriting its own risks precludes payment of insurance or valuation charges for transportation beyond the point at which ownership of goods passes to the federal government (determined by the FOB point or Incoterms). Where increased carrier liability is available without charge, the Contractor must obtain the increased liability for shipment.
13 Shipment Documentation
For the shipment of goods, the transportation bill of lading must accompany the original invoice, except for "collect" shipments (if and when stipulated), in which event it must accompany the shipment. In addition, a packing slip must accompany each shipment, showing item, quantity, part or reference numbers, description of the goods and contract number, including the CRN and PBN. If the goods have been inspected at the Contractor's plant, the signed inspection voucher must be attached to the packing slip normally enclosed in the packing note envelope.
14 Payment Period
- Canada's standard payment period is thirty (30) days. The payment period is measured from the date an invoice in acceptable form and content is received in accordance with the Contract or the date the Work is delivered in acceptable condition as required in the Contract, whichever is later. A payment is considered overdue on the 31st day following that date and interest will be paid automatically in accordance with section 11.
- If the content of the invoice and its substantiating documentation are not in accordance with the Contract or the Work is not in acceptable condition, Canada will notify the Contractor within fifteen (15) days of receipt. The 30-day payment period begins upon receipt of the revised invoice or the replacement or corrected Work. Failure by Canada to notify the Contractor within fifteen (15) days will only result in the date specified in subsection 1 to apply for the sole purpose of calculating interest on overdue accounts.
- Date modified: